For a long time, persistent trading in the crypto world was dominated by well-known centralized exchange platforms such as Binance, Bibit, OKX, MEXC, and others, as these platforms were widely recognized as having greater advantages over their decentralized counterparts.
The CEX platform is perfect for PERPS trading as it leverages the enormous liquidity and allows transactions to be processed very quickly while providing a user-friendly interface. It also combines extremely high leverage with more advanced ordering types.
However, such features are no longer exclusive to the CEX platform. This year, there are plenty of new announcements and integrations, showing that decentralized exchanges are catching up quickly, offering Perps Trading Experience.
1: Dydx Cosmos Transition
Dydx focused on strengthening decentralization, which it gained from having its own Cosmos-based Appchain, but another major benefit was the increased trading efficiency that was made possible by the transition.
When Dydx Dex moves from Ethereum to the native DYDX chain, it has increased throughput and significantly increased transaction speeds. They also created a new off-chain ordering mechanism to allow traders with much lower slippage than before, significantly reducing gas speeds to reduce traders’ costs. Additionally, seamless interoperability with the wider COSMOS ecosystem allows DYDX to take advantage of a vast pool of liquidity shared by multiple networks.
These features allow DYDX to provide an efficient PERPS trading experience that is as good as you would find on the CEX platform, with up to 50x leverage.
2: GMX Synthetic Asset PED
GMX changed its game for its decentralized trading platform when it became the first DEX to provide synthetic assets Perps. This is a financial instrument that you can infer about derivatives of various crypto and Tradfi assets without directly owning it.
Synthetic assets are supported by GMX Exchange. GMXExchange provides liquidity through a multi-asset GLP liquidity pool, supports highly leveraged transactions, and accurate pricing information is delivered via Chainlink Oracle. The complex algorithms that manage GLP pools can help reduce the price impact of large volumes of transactions to support deep liquidity as well as more streamlined PERPS experiences.
GMX’s synthetic assets allow users to trade not only cryptocurrencies such as BTC, ETH and SOL, but also products such as gold, silver and platinum, as well as traditional currencies such as the US dollar and euro with up to 100 times the leverage.
3: Injective’s Cross Chain Purp
Another important advance in decentralized trading came from injection protocols that introduced the idea of a permanent cross-chain swap using the IBC protocol. This innovation has launched a way for users to trade PERPS contracts on multiple crypto assets without being restricted to a single blockchain.
The IBC protocol supports simplified and secure data exchange between uneven blockchains within the COSMOS ecosystem, dramatically enhancing the liquidity of more obscure assets and enabling much more leveraged transactions. Furthermore, Injective’s unique consensus mechanism minimizes transaction fees, allowing for extremely fast transaction execution and settlement, making it one of the most cost-effective DEX platforms for PERPS trading.
This was a key innovation setting the stage for more advanced financial products and the creation of customized markets that rival the diversity of the CEX-based PERPS trading environment.
4: Customizable Leverage in Apex Pro
While other DEX platforms focus on increasing scalability to support PERPS trading, Apex Pro comes up with even more clever innovations in the form of customizable leverage, allowing traders to decide for themselves how much of their position they want to use for their assets.
Apex Pro Perps allows traders to set their own leverage for each trade directly from within the user interface. While BTC and ETH trading pairs allow for up to 50x leverage, and other cross-margin asset types, traders can opt for lower leverage if they want to hedge risk.
What this means is that traders have the unique ability to customize position values to achieve a more desirable balance between future returns and potential risk. The system automatically displays aphorical positions based on the leverage selected by the user, allowing traders to make more informed decisions in real time based on the margins needed to avoid liquidation.
5: Orbs’ Persistent Hub Ultra
Earlier this year, SpookySwap and Thena Dexs first implemented the new permanent hub ultra of Layer-3 protocol Orbs, integrating persistent trading capabilities and holding ways to expand beyond the standard spot trading market.
Orbs’ Persistent Hub Ultra is based on a plug-and-play infrastructure that leverages the liquidity of dozens of centralized and decentralized exchange platforms and blockchain networks, leveraging Symm.io smart contracts. It also provides SpookySwap and Thena users with the ability to exchange tokens natively available on these platforms. For example, Thena can support popular Pump Memo Coins even if its token is not supported by the BNB chain on which the DEX platform is based.
PERPS trading involves the use of three innovative primitives, including a hedger protocol that optimizes liquidity routing, a liquidator mechanism that manages user location by adjusting collateral and margin thresholds, and priced oracles that provide insight into unrealistic profit and loss data.
6: Perpetual Protocol V3
Announced in January 2024, Perpetual Protocol V3 is a major upgrade that offers a true breakthrough in decentralized PERPS trading, integrating a unique smart lixty framework that supports biometric wallets for increased security and supports off-chain order books for superior liquidity matching.
The Smart Ryquidity Framework is a modular system designed to support all sorts of ways to find fluidity, including on-chain and chain-off-chain sources. For example, users can choose from XYK-style automated market makers, quote requests from commercial liquidity providers, centralized centralized order books, and Oracle-based liquidity strategies.
Through a flexible and configurable liquidity model, Persistent Protocol V3 can mimic the experience of ordering chains while ensuring that all trade settlements are processed on the chain.
Dexs achieved parity
Permanent trading was once the only domain of the CEX platform, but recent advances in efficiency, speed and scalability enabled by some of the previous innovations we have discussed have allowed DEX to turn that concept into their mind. By leveraging superior infrastructure from projects such as ORB and deeper liquidity, DEXS can provide a great user experience for PERPS traders, as evidenced by this year’s burgeoning trading volume.
In conclusion, DEX-based PERPs rapidly achieve equality with CEX counterparts, increasing the appeal of a decentralized trading environment.
